Delhi High Court: Plaintiff must sue at principal office when cause of action absent from subordinate office

In my previous post (here and here), I analyzed the jurisdictional position of IP litigation after the SC’s decision in IPRS v. Sanjay Dalia. I noted there that a division bench (DB) of the Delhi High Court has interpreted Dalia in Ultrahome Constructions v. Purushottam Kumar Chaubey; wherein the Delhi HC ruled that the plaintiff cannot sue at the place of its registered office when it also has a subordinate office where the cause of action has also arisen. The Delhi HC has now upheld this position in Allied Blenders and Distilleries v. R. K. Distilleries and further clarified that the palintiff must sue at the plaince of its principal office and not that of its at subordinate office if the cause of action is not present there.

I have covered here the Bombay High Court’s decision in Manugraph v. Simarq where it has adopted a position contrary to Ultrahome while interpreting Dalia.  

Facts in brief 

The Plaintiff was the registered proprietor of “OFFICER’S CHOICE” in relation to whiskey (Class 33) and the defendant was using “REGULAR CHOICE” also in relation to whiskey in Andhra Pradesh. The Plaintiff, having branch office at Delhi, filed a suit for infringement/passing off before the Delhi High Court and sought inter alia a permanent injunction against the Defendant’s use of REGULAR CHOICE [Impugned Mark]. The defendant challenged the jurisdiction of the Court since no part of the cause of action arose in Delhi.

Arguments

A argued that there was a reasonable apprehension that the Defendant was going to use Impugned Mark in Delhi as well; thereby giving rise to the cause of action in Delhi. Section 20(c) of the Civil Procedure Code, 1908 empowers the plaintiff to sue it at the place where the cause of action wholly or partly arises. Therefore, the plaintiff argued that the Delhi HC had territorial jurisdiction to try this suit pursuant to Section 20(c) of the CPC. Here, the Plaintiff was essentially asking for a quia timet injunction; which can be granted by Courts to restrain a person from committing a wrong which is highly imminent but has not yet commenced. Essentially, it’s the judicial equivalent of nipping it in the bud. Madhulika and Aparajita have covered quia timet actions on SpicyIP here and here. On the other hand, the Defendant vehemetly argued that the cause of action, if at all there was any, had only arisen in Andhra Pradesh and that the Plaintiff should neither be allowed to rely upon Section 134(2) of the TM act or Section 20 of the CPC to bring any action in Delhi.

Decision

Since the Defendant had already commenced manufacturing and selling whiskey under the Impugned Mark, the Delhi HC observed that the plaintiff could not be entitled to a quia timet action. Therefore the invocation was invalid insofar as it was under Section 20(c) of the CPC as the cause of action had not yet arisen in Delhi. Moreover, a permanent injunction would have an effect all over the country, and the Delhi HC said that it did not possess the territorial jurisdiction under Section 134(2) to try this suit. The Court relied upon the SC’s decision in Dalia and the Delhi HC’s interpretation of Dalia in Ultrahome Constructions to hold that the suit should be brought before the Bombay HC; where the plaintiff had its registered office. In particular, the Delhi HC relied upon this previous finding in Ultrahome:

“…in addition to the places where suits could be filed under section 20 of the [Civil Procedure] Code, the plaintiff can also institute a suit under the [trademark and copyright acts] as the case may be, by taking advantage of the provisions of section 134(2) or section 62(2), respectively… Under these provisions four situations can be contemplated in the context of the plaintiff being a corporation (which includes a company)… The fourth case is where the cause of action neither arises at the place of the principal office nor at the place of the subordinate office but at some other place. In this case, the plaintiff would be deemed to carry on business at the place of its principal office and not at the place of the subordinate office. And, consequently, it could institute a suit at the place of its principal office but not at the place of its subordinate office…” (emphasis supplied)

Let’s peruse the jurisdictional table provided by the Delhi HC in Dalia to see if Allied Blenders has followed suit:

It can be seen that Allied Blenders falls under the fourth scenario:

Therefore, I believe that the Delhi HC’s decision is completely in line with the SC’s decision in Dalia and Delhi HC’s decision in Ultrahome. While this may be purely incidental, this judgment is also not in conflict with the Bombay HC’s decision in Manugraph.